UPDATE: Here's the final version of the Alexander-Collins ACA stabilization bill
Sens. Lamar Alexander and Susan Collins have now formally introduced their proposal to stabilize the Affordable Care Act’s insurance markets. The details are about what we anticipated: three years of funding for the law’s cost-sharing payments; three years of funding for a new reinsurance program; and a smattering of new regulatory flexibilities.
What’s next: Alexander and Collins are hoping to get this proposal included in the omnibus spending bill Congress needs to pass this week. We should find out soon whether it's in or out.
I have a lot on my plate today; thankfully, David Anderson is doing a "live-tweet" of the highlights/lowlights. Instead of posting his tweets verbatim, I'm converting them into standard language:
- Looks like the Minnesota BHP funding problem would be resolved (makes reinsurance in New York much more plausible too)
Good....except for a possible big red flag from Michael Kalina, who thinks that the MN/NY BHP funding may be an illusion (I'll have to learn more about this)
- big money for reinsurance --- FY 18 is
$5 billionand then FY 19-20-21 is $10 billion per year... not sure why the FY-18 funds are included
They're sweetening the pot a bit more here:
$35 billion $30.5 billion over 4 years, up from $30 billion over 3, which was up from $10 billion over 2, which was up from $4.5 billion over 2 originally.
Update: Whoops! It's actually $500 million for 2018, not $5 billion! h/t FarmbellPSU in the comments for the catch!
- Section 602-3 is basically the 1332 rewrite that would have allowed for the Iowa Stopgap measure's final revision
- Waiver budget guidelines are to be evaluated over 10 years
- Minor change from A-M waiver approval time frame switches from 180 days to 120 instead of the 90 days in A-M (actuaries won't need as much caffeine, they thank you)
- 45 day provisional/emergency approval timeline for bare counties and wicked high rate increases as well as for reinsurance 1332 applications. Provisional approvals good for 3 years, full approvals good for up to 6 years unless state requests less.
- Language adds restrictions compared to A-M --- Sec. HHS can pull a 1332 waiver if state "materially failed to comply" There goes @nicholas_bagley Cocaine and Hookers analysis
- HHS/CMS is to develop off the shelf waiver applications (a good idea)
- Part G is reinsurance and invisible risk sharing --- mainly mechanics.
- P.21 Cost Sharing payments are funding retrospectively for October 1-December 31, 2017 and all 2018, 2019, 2020 This is going to be the big fight as the reinsurance money pumps $35 billion into the ACA individual market and the PY18,19, 20 pulls out at least that much
As I've noted repeatedly, there are two provisions which I've been opposed to: Funding the CSRs now (given the complete reversal of the economic impact of doing so after Silver Loading), and the abortion restriction language from the earlier versions. I'm still opposed to funding CSRs now given that it would hurt more people than it helps, but I do understand that there are some valid arguments for doing so. Call this one "half" a deal-breaker.
- P.22 2-A pays the Basic Health Plans of New York and Minnesota for their CSR losses and gets rid of the that lawsuit
- States and insurers that Silver Loaded in 2018 won't get CSR funding. Expectation that they would drop index premiums once CSR is funded for 2019.
That's actually reasonable--the only states which would get CSR funding for 2018 are the ones which didn't load it at all
or which "Broad Loaded" like Colorado. Which means those states ended up kind of screwing over a bunch of people for no reason, though it was an admittedly tough call for some of them given how complicated the situation was at the time.
Update: Another catch from FarmbellPSU..."broad load" states wouldn't receive the CSR funding for 2018 either, since they did still load the costs. I think DC, North Dakota and Vermont would be the only states receiving 2018 CSR funds, though I might've missed a couple of others.
- Section 603 is Copper plans (I hate that language as Copper in my mind is Begich-Warner and this is catastrophic expansion) ties into common risk pool. My big question is what is this supposed to do?
- Catastrophic have an actuarial value of a low Bronze now. They have a premium advantage mainly because they are risk-adjusted separately from the Metal plans. 1312(c)1 language implies Congress wants them to be considered a metal plan and risk adjusted as such.
- That means catastrophic money flows up to Silver-Gold-Platinum plans in RA much like Bronze does and the Bronze-Catastrophic premiums compress. I don't oppose this, I just don't know what it actually does all that much.
Again, as long as Copper plans are kept as part of the single risk pool, I'm OK with this...but as Dave notes, it probably won't make much difference one way or the other.
The main effect it would have is to make it easy for healthcare wonks to sound like they're Dungeon Masters: "You have 10 Copper, 200 Silver, 23 Gold and one Platinum coin! Will you use your +3 Broadsword to attack??"
- Section 604-A is the "allow @Charles_gaba to sleep in November change". $105 million per year to be spent on outreach in OEP2019 and OEP2020
This is an unexpected surprise. Good. It's actually $105.8 million for each year, which is an oddly specific amount--perhaps that's the precise amount spent in 2016? Anyway, it's a Good Thing.
- Section 605 is telling CMS to finally get around to issuing rules on Section 1333 interstate compacts for insurance sales
...which is long overdue, yes, but which not a single insurance carrier appears to be interested in anyway, so it's kind of a moot point. Still, y'know...good enough.
- Section 606 requires clear notification that Short Duration Plans are very lightly regulated.
SEC. 606. CONSUMER NOTIFICATION.
In addition to any applicable Federal requirements with respect to short-term limited duration insurance—
(1) a State insurance commissioner shall require the issuer of short-term, limited duration in8 surance approved for sale in the State to display prominently in marketing materials, the contract, and application materials provided in connection with enrollment in such insurance a notice to consumers that includes such information as the State insurance commissioner determines sufficient to inform the individual that coverage and benefits under such insurance differ from coverage and benefits under qualified health plans; and
(2) a State may establish, implement, or continue in effect any standard or requirement related to short-term limited duration insurance, provided that such standard or requirement does not prevent the application of any such Federal requirement.
In other words, this bill wouldn't expand the definiton of Short Term Plans (that would presumably be dealt with via Trump's Executive Order and/or the Barrasso bill, which would codify them as being allowed up to a full year and renewable), but it would require BIG BOLD FLASHING LIGHT WARNINGS to enrollees that THE SHORT-TERM PLAN YOU'RE ABOUT TO BUY KIND OF SUCKS.
UPDATE: WHOA! Hold the phone...according to Topher Spiro of the Center for American Progress, the last part of the second paragraph above ("provided that such standard...doesn't prevent applicaiton of Federal requirement") would actuall mean this:
This language prevents states from taking action to regulate Trump "short-term" plans, which violate ACA protections for people with pre-existing conditions. pic.twitter.com/tOwvcXIelM
— Topher Spiro (@TopherSpiro) March 19, 2018
If that's the case, then screw this noise.
UPDATE x2: Hmmm...OK, there seems to be a lot of confusion about this point. Amy Lotven of Inside Health Policy and Sam Baker of Axios seem ot think that the wording is the exact opposite of Topher's. Sounds like it's open to interpretation, which is never a good thing when it comes to the Trump administration...
Dave's initial conclusion was that...
- I think that everything in this bill except for CSR funding for policy years 2019 and 2020 could pass easily. CSR funding for 2019 and 2020 pulls a lot of money out of the ACA. This is the major source of conflict as long as Silver Loading is allowed.
...HOWEVER, he tweeted that before he and I realized that yes, the abortion restriction language is still included; it's apparently to be found in sections 602-C and 602-D:
(c) HEALTH BENEFITS COVERAGE.—Notwithstanding any other provision of law, including any other definition of ‘‘health benefits coverage’’ for purposes of subsection (b) and (c) of section 506 of this Act, any use made of funds appropriated under subsection (b) starting in plan year 2019, and subsection (a)(2)(B) starting in plan year 2018, and any program, activity, plan, or coverage funded or supported by such funds, shall constitute ‘‘health benefits coverage’’.
(d) LIMITATIONS.—The following shall apply:
(1) Nothing in this section shall be construed to limit the applicability of subsection (a), (b), or (d) of section 507.
(2) For purposes of this section, a health insurance issuer expending State, local, or private funds, shall be treated in the same manner as a managed care provider described in section 507(c).
Neither Dave nor I noticed this at first, probably because there's no direct references to "The Hyde Amendment" or "abortion service providers" in the text, but it basically amounts to the same thing: Not only could ACA subsidies not be used to cover policies which include aboriton coverage (which is technically the case today already via an absurdly complicated workaround), neither could CSR or reinsurance funding.
In short, Alexander & Collins have indeed sweetened the pot in the past week with things like the extra $5 billion in reinsurance, the $210 million in guaranteed outreach/marketing funds and the BHP funding...but they're still insisting on effectively wiping out abortion coverage for ANY woman on the individual market.
The right or wrong of funding CSRs may be debatable among some Democrats depending on your POV...but the abortion language should be a deal-breaker no matter what.
Here's an updated color-coded version of my take:
- Reinsurance: GOOD!
- Guaranteed Ad/Outreach Funding: Good but only necessary due to Trump cutting funding in first place
Short-Term Plan Notifications: Good but only necessary because of #ShortAssPlan EO in first place(see update below)
- BHP Funding: Mostly Good w/a possible Meh.
- Waiver Flexibility: Mostly Good.
- Copper Plans: Meh.
- CSR Funding (with Silver Loading allowed): (NET NEGATIVE)
- CSR Funding (with Silver Loading prohibited): (it's complicated)
- UPDATE: Short-Term Plan FEDERAL OVERRIDE: DEAL-BREAKER
- Abortion Prohibition: DEAL-BREAKER
- ShortAssPlan Expansion: DEAL-BREAKER (via separate bill)